This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Ford, GM and Toyota Gear Up for Battle

Stocks in this article: GM F TM

BOSTON ( TheStreet) -- The world's largest carmakers ended 2010 on a high note, with two of the top three reporting their best monthly sales for the year in December, which portends strong fourth-quarter earnings and an even better 2011 for what has been a deeply troubled industry.

Over the past two years, the travails of Toyota (T), General Motors (GM) and Ford (F) have included big layoffs and factory closings, bankruptcy and a government bailout in the case of GM, and massive recalls at Toyota, a brand once known for reliability.

The companies now face a new round of challenges in the form of rising fuel and raw-materials costs, which hurt profit margins.

Further complicating matters, domestic sales of passenger vehicles rose 1% last month, while sales of gas-guzzlers, pickup trucks and SUVs jumped 21%, despite the nation's rising fuel prices and an avowed interest in "greener," smaller, more economical cars.

International sales have proved a particular boon for U.S. automakers. GM sold more vehicles in China last year than it did in the U.S., a first in the company's 102-year history, while Ford's sales in China soared 40%.

Zacks Investment Research analysts say rising sales in December are indicative of a rebound in consumer confidence, since people are more inclined to make big-ticket purchases when they see rising employment, as it makes them feel more secure. As a result, Zacks projects industry-wide sales will rise 11.2% to 12.9 million vehicles in 2011.

Toyota, based in Japan, maintained its title of world's largest automaker in 2010, despite a 5.5% decline in December sales, with 8.42 million vehicles sold. That barely beat GM's 8.39 million in sales. GM racked up a 12% global sales gain on the year.

GM and Ford are expected to report solid fourth-quarter results as their December sales were their best monthly results for all of 2010.

Shares of automakers are up 4.3% this year, as tracked by Morningstar. The broader S&P 500 Index is up 3% this year.

What follows is a summary of earnings expectations for the three biggest auto makers, led by Ford, which will be the first to report on Friday, along with cars that may help profits the most this year.

1 of 4

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs